It is OK for them, but what about our government?
Güven Sak, PhD
17 September 2009
Medium Term Fiscal Program (MTFP) began to be shaped. Now we at least know that there exists a text on which an agreement is reached "within the government" in general terms. This is a positive development. Now we will wait to see what the general statements mean and whether or not these will be put into practice problem-free. Of course in the meanwhile we can start evaluating the existing parts of the document. Today, let us continue thinking on the fiscal discipline and fiscal rule concepts. In this context, it might be easier to evaluate the figures announced.
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What is fiscal discipline?
Güven Sak, PhD
15 September 2009
Turkey overcame the 2001 crisis by tightening the belts. Base issue was the budget discipline. Now we are faced with the 2008 crisis. And we are at the beginning of a period where we have to tighten the belts. Budget discipline is again the base issue. Then, is the problem in 2008 is the same with that in 2001? No, it is not. Let us explain why we think this way.
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'IMF light' again after nine months
Fatih Özatay, PhD
14 September 2009
Discussions in Turkey so as to whether or not Turkey should sign an agreement with the IMF are posited over wrong grounds almost for a year. I believe that a substantial part of the opinions set forth in this regard can be reduced into two main groups.
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Turkey is overcoming the economic crisis: a new indicator
Fatih Özatay, PhD
13 September 2009
Oh God! How do I make this mistake? How did I miss the leading indicator showing that Turkey is about to leave behind the economic crisis? I apologize to you all. But let me go back in time to explain clearly why I apologized.
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Do you follow the changing geography of overweight
Güven Sak, PhD
12 September 2009
Last week, we said that one billion overweight people all around the world can be taken as an evidence for the unsuccessfulness of economists. Our aim was to explain to the "we do not like economists" group that occupied the agenda with the emergence of the global crisis that not all economists are the same. There existed good economists and bad economists. Thinking that a subject about economics would be too boring alone, we opened the issue with overweightness. However, the data on the number of overweight people and people suffering from hunger were printed wrong on the newspaper. So, we had to go back to the overweightness topic and give the correct data. Therefore, the topic today is the changing geography of overweightness. Let us see how the bitter end of real socialism trials derai
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Things the meeting made me think
Fatih Özatay, PhD
10 September 2009
I was trying not to write about the top-topic IMF issue as it became highly boring and unpleasant. But, today I will write about the IMF. The reason is: On Monday, I participated in a limited-attendance face to face discussion meeting in Brussels on behalf of TEPAV. Around the rectangular tables, academics, some press members, EU and IMF representatives, some old central bankers and representatives of think-tanks were sitting. Majority of the participants were from Central and East European countries.
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What is the challenge faced in the tight space?
Güven Sak, PhD
10 September 2009
Today let us continue with the topic we started to talk about on Tuesday. The topic was the upcoming period. When you look around, Turkish government that reflected the image of a sleeping beauty since the beginning of the crisis seems to open its eyes this time, when the issue of economic policy is considered. We cannot know whether or not the government will open its eyes, but we had better get prepared. Opening the economic issues of the coming period to discussion in advance can help us getting prepared in a way. With such an opinion, last week we opened to discussion the proposition "Are we in a climate where economic policy space tightens?"
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Does economic policy space really tighten?
Güven Sak, PhD
08 September 2009
What should come to our minds when we hear that economic policy space tightens? I guess two things can come: First, there is no action to take in the current economic process. There is no option other than bowing to the inevitable. Second, there are actions to take; but the opportunity to take those is either nonexistent or highly limited; i.e. there exist no room and no means. Let us view the economic policy space in the coming period with this lens. Does the space really tighten?
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Economic opening
Fatih Özatay, PhD
07 September 2009
In a meeting last week, a businessman said "We also need an economic opening." This sentence is a nice summary of the current economic situation. There exists an important problem. If we do not fight with it, it will grow and will be excess baggage for Turkey's future. It is necessary to fight with the problem; but how? What if we make the problem more complicated trying to solve it?
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Limited things can be done in the short term
Fatih Özatay, PhD
03 September 2009
The time and the pace of the recovery from recession are now out of our control even partially. If we could have taken the control and make some decisions at the end of 2008 where the crisis intensified and potential effects became apparent, we would now have the control. Now, this is not a possibility. The main reason is the current level of the budget deficit and the risk of further increase in the deficit if no measures are introduced. The most concrete evidence for this are the latest raise in the electricity price and the discussions focused on health expenditures. It seems that the financial structure of the public enterprises operating in electricity market is so corrupt that such a huge raise in electricity price was introduced.
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